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US-China trade war fears put Asia stocks in retreat
Economy

US-China trade war fears put Asia stocks in retreat

Agency News

As investors switched out of equities safe-haven assets such as government bonds found favour, with yields on German benchmark debt approaching record lows.Asian stocks tracked Wall Street losses on Thursday as latest exchanges between Beijing and Washington signalled the heightened risk of a prolonged trade war, stoking investors’ concerns about the impact on global economic growth.

“This kind of deliberately provoking trade disputes is naked economic terrorism, economic homicide, economic bullying,” China’s Vice Foreign Minster Zhang Hanhui said, as Beijing continued to dial up its rhetoric amid the festering trade war with the United States.

His comments came after Chinese newspapers reported that Beijing could use rare earths to strike back at Washington after US President Donald Trump remarked he was “not yet ready” to make a deal with China over trade.

As investors switched out of equities safe-haven assets such as government bonds found favour, with yields on German benchmark debt approaching record lows.The Shanghai Composite Index fell 0.8% and Hong Kong’s Hang Seng lost 0.35%. Japan’s Nikkei was down 0.85% and Australian stocks shed 0.7%.MSCI’s broadest index of Asia-Pacific shares outside Japan was 0.1% lower after briefly slipping to a fresh four-month low.

The G20 meeting is set for June 28-29 in Japan. Amid the flight-to-safety Germany’s 10-year bond yield fell to a three-year trough of minus 0.179% overnight. A drop below minus 0.200% set in 2016 would take the yield to a record low. UNI